>> smith: today on "face the nation"-- power shift. the new congress-- more republicans, fewer democrats. and the president says he's ready. >> i'm willing to work with any one of either party who has got a good idea and the commitment to see it through. >> smith: who will hold sway? what influence will the tea party have on the republicans? and for democrats, will they be united against republican rule? can the two sides work together? we'll talk with house democrats debbie wasserman shultz of florida and anthony weiner of new york, along with republican tea party caucus leader michelle bachman of minnesota plus tea party backed representative- elect mike kelly of pennsylvania. then we'll hear from the new chairman of the house committee in charge of government investigation, dennis issa, about his plans. but first, what's ahead for the

new congress on "face the nation." captioning sponsored by cbs "face the nation" with cbs new chief washington correspondent bob schieffer. and now from washington, obubstituting for bob schieffer, harry smith. >> smith: happy new year, everybody. thank you all, panel, here in washington for joining us. michelle bachman joins us this morning from minneapolis. well, the 112th congress is set to convene on wednesday. but i want to go back a little bit and talk about the last workings of the 111th with you, michelle. in particular, that the year ended with this deal on taxes and an extension of unemployment benefits. would that deal have been made with a congress that's about to take... convene on wednesday? >> well, that's a good question. there was a diversity of opinion on this bill. i voted against it because i was concerned about it not being paid for.

it also blows a $111 billion hole in the social security trust fund. there is no money in that trust fund, so they have to go to the general treasury, where there's also no money. that means an additional borrowing for that $111 billion in addition to the $57 billion for unemployment. so we're continuing to go down the road that we've gone down before, which is spending money that we don't have. that's really i think one of the strongest messages that we took away from the election in november. "stop spending money that you don't have." >> smith: is the republican party in this new congress, is it a house divided? >> no, i really don't think it is. i think we're very... we're fairly unified. of course, we won't all necessarily be agreeing on everything. but i think you see a fairly cohesive group that we have a singularity of purpose and that we want to be able to get the budget in order. i think that's really job number one because we want to see the economy shift so that we have a focus on private job creation.

>> smith: i want to go to congressman weiner. a couple of weeks ago, we had a conversation and you told me that if the president extended a finger of bipartisanship, that it would cost him a pound of flesh. how do you see this new congress working with the president? and are democrats all but irrelevant from now on? >> look, what we'll see, we've already seen on this show there's disagreement among republicans about the tax cut bill. i think that there will be disagreements to come. i mean, many of them campaigned on the idea of privatizing social security. they campaigned on the idea of making medicare a voucher program so seniors don't have guaranteed health care. i want to see what it is they're in favor of. we heard about what they're against in this campaign. i don't know what they're in favor of. we democrats are prepared to work with them where we can, but we're going to challenge them and fight against them where we must. it is not a subject of compromise for many democrats, privatizing social security. we don't believe that's a good idea. eliminating medicare as a guaranteed benefit for seniors-- we don't agree with. those fights are going to happen. as far as the president's

interaction, i think he's going to find out that bipartisanship has to be a means; it's not an end. and that if just having a bipartisan deal means success, that's not right. it has to reflect the values of this country and the constituents that i represent. >> smith: mike kelly, you're the new guy. you've been around this town for a couple of weeks now. there was a piece in "washington post." you said you're not impressed so far. what do you hope to accomplish when you take office for real? >> i think really when you talk about, are you impressed or are you not impressed? i don't think for an average guy the common guy who comes from a private sector, running something $14 trillion in the red is not impressive. if you run $14 trillion in the black, then i'm impressed. i'm looking for is it good to be bipartisan, but is on good legislation? just to say we did something in a bipartisan manner, just to show that we can agree is not good, unless i was something that was good for the whole country. i'm looking to really go to work and work very hard. i've worked hard all my life.

i've done it with my own money. i've had my own skin in the game. i'm kind of interested to seeing when you get in a situation where it's not your money. you can spend anything you want. keep raising the debt ceiling as much as you want, because you don't have to worry about paying it back. it's hard for me to think that that's all right to do with the american people. >> smith: we'll ask about the debt ceiling in just a couple of seconds. but i want to talk to debbie wasserman shultz about this whole idea of bipartisanship. is this going to be a situation where congress gets together and does the people's good? or is this a recipe for gridlock? >> well, that remains to be seen. what democrats will do, now that we're in the minority in the house but remain in the majority in the senate and hold the white house, is measure everything that the republicans propose by whether it creates jobs, turns the economy around, and cuts the deficit. what remains to be seen is whether members like mike kelly are going to be able to turn their essentially campaign rhetoric into some kind of

reality, because with all due respect to his response, there isn't any there there. we haven't heard any concrete proposals. anthony is absolutely right. we've only heard attacks on what they don't like. we've got to make sure that we continue the progress and the prosperity we've been moving forward towards. the s&p finished the year up 86%, the dow up 16%. we've increased manufacturing exponentially. we're beginning to aggressively turn that economy around. let's hope they don't squander that. >> smith: here's a question for everybody. government is funded basically until about march or so. there will be a vote eventually on raising the debt ceiling. will you vote to raise the debt ceiling? >> i'm going to wait and see the direction that the republicans want to take our policies. >> smith: congressman. >> i voted against this tax cut bill because i thought it blew a hole in the budget. i think the republicans have come in saying they're not going to not raise the debt ceiling and allow the full faith and credit of the american people go down the tubes. it's their ship to run now. that's their responsibility.

this is an adult game now. >> smith: now to mike kelly. mike kelly, this will be one of the big votes. you risk having the government come to a standstill. >> you know, speaking as an adult who has always paid his own way, i do understand what happens and raising the debt ceiling to me is absolutely irresponsible. we've been spending money for so long that we don't have. "it's okay. we'll just raise taxes and find it somewhere." tax revenue comes from people who are working, people who are profitable. it does not come from raising tax rates. >> smith: michelle bachman? >> at this point, i am not in favor of raising the debt ceiling. as a matter of fact, i have a petition that i'm urging people to sign at michelle.com to urge their member of congress not to raise the debt ceiling because the congress has had a big party the last two years. they couldn't spend enough money. now, they're standing back folding their arms saying, "oh, taunting us how are you going to go ahead and solve this big spending crisis?" it's fine when they have the credit card and they're spending money.

>> smith: it's worth the risk? >> it's not good for anyone to shut the government down. it's not good for anyone. that's why it's important for the democrats who are so willing to spend money to now be a part of trying to figure out how we can be responsible. >> (all talking at the same time) >> one of the first things... one of the first things we're going to do is vote to pass the republican proposed rules package. in talking about the debt ceiling, their proposed rules and, mike, you talked about in your campaign the importance of one vote. i want to see whether you're going to vote for that rules package that gives paul ryan the authority to set the budget limits himself. taking away your vote that you talked about that was so precious. and taking the right of all of us in the house of representatives-- having one member set the budget ceiling for the entire country is absolutely irresponsible and undemocratic. >> smith: go ahead. >> this is what america loves. this is what america loves. both sides pointing the finger at the other saying "it's your fault." >> it's not about fault.

what are you going to do. >> when we talk about having adult conversations, we have to start acting like adults. it's very amusing to walk through this. i have to tell you for being on the outside all my life, i don't know how in the world you folks go home and look these people in the eye and say "we've done a great job." your country is $14 trillion in debt. >> you've got the opportunity now. >> congressman kelly, now you are one of those folks. it is your job in the majority party to govern. the first thing the republicans did when they took back the house the last time is they drove the government to a shutdown. i guess, from what i've heard michelle say and you say, that's what's going to happen again. all the "you" stuff has to end today. >> you've got it exactly wrong. that is not what we're looking to do. you're stating it falsely. we are not look to go shut the government down. no one benefits. but at the same time, we're not looking at wanting to continually raise the debt ceiling. that's something that the democrats want to do.

>> i don't know what you call it, but that's shutting down the government. >> smith: one of the things that the tea party has talked about is dismantling health care. we're wondering if, in the end of the day, that ends up being a fool's errand because no matter how many votes you amass in the house, and even if you could get the votes in the senate, it will face a certain veto. is it worth the effort to try to do? >> of course it is. because "obama care" will bankrupt the country. you've seen that the more the people learn about "obama care," the less they like it. it's very costly and unwieldy. we will put forth a clean repeal bill of "obama care." you'll continue to see us make that fight because that's what the american people want us to do. the real problem in health care is the cost drivers. "obama care" is actually raising the cost drivers. we want to adopt a free market approach to health care. you'll see us put those free market solutions forward. >> smith: even democrats realize

that the deficit is almost... it's out of control. it's beyond reach. it's this weight that is.... >> what you mean "even democrats?" ( laughter ) >> let's remember the deficit was exploded by republicans. president bush inherited a record surplus and turned it interest a record deficit. two wars unpaid for. a prescription drug plan unpaid for. tax cuts unpaid for. so the deficit that we found ourselves in was thanks to the republicans. >> smith: is it addressable? >> harry, if i could just add, there is no equivalency. >> i think that it has to be. i think that there is a lot of room for bipartisan work. "time" magazine, without much sweat< came up with $100 billion of corporate welfare. i think we can find cuts. i've been working with jason chavitz in utah. we found cuts. there's no doubt about it though. some of the big things are philosophical questions. the republicans have philosophically said they don't believe in the guaranteed social security benefit. they don't believe in a

guaranteed medicare benefit. >> harry, anthony continues to make these statements. >> michelle you voted that for the republican alternative last year. >> it's very important to remember that president... >> smith: hang on. >> harry... >> paul ryan... >> harry, since president obama came into office, we've had over $3 trillion in deficit. we're looking at another $1 trillion in deficit. let's try to just get our arms around that reality. it's massive. >> smith: hang on one second. there was an economic... >> we're now up to $14 trillion. we can't continue to go down that road. >> can we go back to health care reform for one second? that's one of the first things we're going to do this week. >> smith: how is this going to get paid for, by the way? if this deficit continues, can the government...? >> apparently, my republican friends believe that tax cuts for millionaires and billionaires-- somehow the bill

fairy pays back. >> can we go back to health care reform for one second because saturday the health care reform piece that was implemented was we cut prescription drug bills for senior citizens by 50%. we've already made sure that young adults up until their 26 can be on their parents' insurance. a constituent in my district came up to me a few weeks ago and thanked me for saving her $3,000 a year, because she could put her two adult children back on her insurance. that's what the republicans are going to be proposing to repeal. it's not going to happen. if it's about jobs and the economy and reducing the deficit, wasting time and money and adding to the deficit by repealing health care reform or on the attempt.... >> harry. >> smith: hang on, michelle. i want to get mike back in here once again. mike, you've already taken a look at this. you're not going to take the government-sponsored health care program that is available to members of congress, right? >> no, i'm not. i've always paid for my own health care. i come from the private sector. i've been in my whole life i've

been for everything that i do. i think we've these conversations, and i think this absolutely goes back to worrying about how many angels we can fit on the head of a pin. there is a cost with everything involved. my early time here in this city is so different than where i come from. because i live in a real world where people actually have to use their own money to pay for things. so this idea that you can keep doing this or doing that, and i love this fact that we are going to pay for it. we are not paying for anything. not we in washington. the people, the american taxpayer pays for everything. that's what bothers me. there's such a disconnect between this town and the rest of the world. >> this real world stuff is going to get old really fast. this is now your job. >> i understand that. >> this is a serious business here trying to figure out how to solve big problems. social security does have to be paid for. medicare does have to be paid for. but this idea like "the real world..." >> you're very amusing. in your life, you have never done everything on your own with your own skin in the game. i respect the fact that you're an elected congressman, i do not

respect the fact.... >> what do you mean i am. we are. you're part of this now. >> i'll become part of it on the 5th. this has got to stop being about who can blame who for what. >> you're sounding like us versus them. >> smith: gentlemen, hang on. >> i would hope you have more respect for your constituents. >> i do. >> time to go beyond rhetoric. >> harry. >> go beyond campaign slogans, which is all i've heard from mr. kelly and ms. bachman really ever engages in. we have to get into deficit reduction, job creation and turn the economy around. that's their yardstick. >> smith: michelle, very, very quickly. >> thank you, harry. >> smith: ...anything that you have in common with your friends from the other side of the aisle? >> i would say if they want to engage in deficit reduction, that's exactly what we want to engage in is deficit reduction. but it's so interesting, harry, for two years, these were big

wild party spenders. now they're interested in deficit reduction. that's what we'll do because i'm similar to mike kelly. my husband and i also started our own business. we also live in the real world. the real world is where america lives. it's not the bubble in washington, d.c., where they engage in... what you'll see happen is emphasis on personal responsibility. >> smith: the last word. >> we went from bleeding 750,000 jobs a month before president obama took office to last year adding over a million more jobs created last year than the entire bush presidency alone. we need to continue that progress and hold the republicans' feet to the fire and we will. >> smith: if the last 15 minutes were any indication, it will be a very interesting new year. thank you all very, very much. >> a pleasure working with you. >> smith: that's what we want to see. thank you all very much. congressman darrell issa when we come back. man darrell issa when we come back. [ male announcer ] how can rice production in india

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>> smith: the new chairman of the house oversight and government reform committee, darrell issa. >> good morning. >> smith: some of your supporters can't wait for you to get to work. your detractors say this guy is a gadfly with subpoena powers. i'm going to go back to something that you told rush limbaugh not so long ago that you thought president obama is one of the most corrupt presidents... a statement that.... >> i walked back very quickly and said it's about the money the administration has had in a loose fashion. it's more about congress's mistake in funding. >> smith: my question was, do you think obama administration is corrupt? >> time and time again, we've seen the obama administration playing fast and loose with the walking around money congress gave them. when we saw the joe sestak situation, what we found was yes that's wrong. arlen spector and others said it was illegal. we found that the bush

administration admitted doing the same thing. this is what usually happens when our committee does its job is we find out that there's business as usual, whether it's in the white house or in the bureaucracy, that won't get changed unless we shed light on it and, on a bipartisan basis hopefully, and in the past it has been, look for those kinds of change. we have done a lot of work toward that kind of change. >> smith: wednesday morning, you take over this job. you've had months to think about it. what is the absolute top priority? what is the number one thing on your list? >> the number one thing for all of us as republicans is jobs and the economy. but also the confidence in government. if we can, as speaker-elect boehner has done, said, look, we're lopping off 5% off our budget. >> smith: your own personal budget. >> and my committee budget. we can lop off 5% of government through simply saying, find a way to live within that budget. we can save $125 billion in simply not giving out money to

medicare recipients that don't exist for procedures that didn't happen. these are real dollars. 10% of the deficit goes out in wasted money. we also have $1.75 trillion estimated worth of excess regulation costs to our businesses. imagine if we could take even a third or a half of that, a trillion dollars, off of the cost of doing business in america? how many jobs would come to america? my committee has to work on all those. >> smith: you know, it's interesting what is real regulation for some would be excess regulation for others. among the things that are being talked about is the environmental protection agency and its powers. cap-and-trade is dead, as far as the legislative issue is concerned. do you feel like it has too much power and that it's wielding it in a way that ends up achieving the goals of cap-and-trade? >> harry, government has to give predictability. it's why regulations have to flow from the intent of the

legislation. it has to be done over time with public hearings, comments, and buy-in. one of our problems, president obama recently said that he had learned that there's no such thing as "shovel ready." well, during the fdr administration when the wpa programs and other work programs went into place, "shovel ready" meant you made a decision today and within a week or two you began working on a project. america has to get epa, osha., fish and wildlife, all these agencies to have to get to where you can decide to do something worthwhile, get through the process to make sure it's done right, and do it in a short period of time-- a year, not ten years. >> smith: the mandate it seems to me of especially the new republicans being sent to congress is to shrink the deficit, shrink government, save money. with oversight, how much money do you think you can save the taxpayers, say, over the next two years? >> i'm looking at about $200

billion. as the amount that we can either identify and eliminate the waste, or at least begin the process. i've give you one that's pretty easy. it's been in the papers. in the last days of last congress, they funded $500 million for a rocket program at nasa that's already been shut down. that can't be too hard to undo. but $500 million here, $500 million there-- that's a billion. $125 billion in medicare. the person heading up the stimulus has done innovative work to show us how we can find a lot of that fraud and shut it off. don't worry about going after somebody 18 months later. make sure the money doesn't go out. that's real savings. >> smith: it's interesting though, because in the conversation that we had earlier with all... with the other members of congress and soon to be members of congress talking about cutting deficits and everything else, entitlements still sit out there. that is really the monkey on the american taxpayers' back.

and a billion here a billion there and after a while, we're talking about real money. we're talking about trillions of dollars. will this new congress really be able to address any of that? >> you didn't see it here in the last panel. you didn't see the willingness to take the two big issues on. anthony weiner started saying that the republicans don't want to protect social security and medicare. look, when medicare part-d was put into place, the first thing we did was means test it. we said we're going to do this prescription drug but only for those who can't afford to do it for themselves. if you can't afford, we're going to phase out some of the benefits. it's got to be on the table. it's not popular or easy. social security is an easy one to solve because it's money in, money out. but the money doesn't balance. >> smith: baby boomers who start collecting on january 1. >> and my wife is a baby boomer. now, she's going to be collecting. i'll be collecting at 67. i'm a couple years younger. the fact, though, is that we have to figure out a way either to have more money in or less

money out. very simple. medicare, though-- and we saw this with obama's health care proposals and the ultimate bill that was passed-- medicare's more complicated. it's rising faster than inflation. there are no cost controls on it. we need to make those changes, in addition to getting rid of $125 billion in fraud that goes out every year >> smith: we'll be back in a moment. [ male announcer ] the face of hunger in this country is all around us. 1 in 6 americans live in hunger. at bank of america, we've created the gift for opportunity fund to support feeding america and the boys & girls clubs' efforts to provide hunger-relief. and we invite our customers, associates and communities to help. every dollar you contribute this season can be matched, dollar for dollar. together we can make twice the difference to help support those in need. ♪ to help support those in need. copd doesn't just make it hard to breathe...

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